A short guide to NFTs for artists and collectors.
(text originally posted on Medium by PC)
NFTs has taken the world by storm in March 2021 with record-high auction of Beeple artwork, record sales of NBA Topshot and OpenSea marketplaces. With NFTs entering mainstream, it’s worth looking at it as a great opportunity for artists and creators to diversify their income streams, and for collectors to discover and collect interesting art pieces from around the word.
Short intro to NFTs
NFT, or Non-Fungible Token, is a non-interchangeable proof of ownership living on a blockchain. Practically, it can be pointing towards a work of art, a piece of music, or other asset, describing its properties and a place to find it. For example, an NFT can be pointing towards a digital painting (a .jpg file).
Usually, when people say NFT, they mean the underlying asset, not the actual smart contract.
What does this mean for the artists? NFTs are a great way to create original digital copies, thanks to this proof of ownership mechanism. All other copies of this .jpg file are akin to digital prints of the original artwork, even if the artwork is the same on all .jpgs — the difference lies on the blockchain. The NFT smart contract shows which one is the original.
How to start with NFTs in 2021
If you want to start with NFTs, either as an artists or as a collector, the best way would be to go to one of the three main platforms:
OpenSea is the most open one, and the cheapest to start with. The cost here is important because whenever you want to put something on the blockchain, you need to pay ‘gas fees’ and these currently are at the level of $40–$60 for the Ethereum blockchain.
OpenSea only requires you to pay for the very first transaction, when you create your store for digital art. This makes it especially well adjusted for collectible and longer series of artworks. However it’s also harder to gain visibility due to the volume.
On the other hand both Rarible and Foundation are more exclusive to art and individual pieces. However you have to pay for each artwork you put on there. Moreover in order to get into Foundation, you have to either have an invitation from an artist already there or gain enough community upvotes.
If you’re an artist, any of these platform will be good to start, though definitely OpenSea is currently the easiest to configure and get going. I encourage you to experiment with all three.
Short guide to collecting NFTs
If you’re more into collecting NFTs and artworks, you should first determine whether you’ll be going after art pieces or digital collectibles, as these two categories have different dynamics. Digital collectibles are usually hype-driven, a lot depends on the community build around the project and potential long-term interest generated by the creators. Art pieces entirely depend on the artist background and you should only pick things you like and can hold for a longer period of time.
Both Rarible and Foundation are great for more art-focused collectors. If you’re looking for digital collectibles to buy and hold a’la Pokemon or sports cards, then OpenSea will be a better source. From countless iterations on CryptoPunks, to CryptoKitties and AI-generated artwork you’ll find many interesting pieces.
It’s hard to tell how the value of these pieces will change over time, so it’s the best to do your own research before buying, see who’s the author of the artworks/collections and what’s their long-term plan.
In the end, art is a social construct and you need two sides, creators and collectors. Art cannot exist without both being active and focused on long-term relationship building. Community is key!
P.S. I’m in love with NFTs since I’ve discovered them and an active collector and creator, using artificial intelligence as my primary tool. You can read more about my creations here or go to my project page AIANFT.com, where I post about my collections and upcoming drops.